The US and India should build rampways for India’s development

Thanksgiving Day thoughts on the US-India relationship and the importance of giving back for India’s development.

By Nish Acharya

The second in a series of articles about US-India relations under President-elect Trump & Prime Minister Modi

Nish-Acharya-150-x150BOSTON: This week is Thanksgiving in the United States. For most people, Thanksgiving means three important things – food, family and giving thanks for the good things we have been given in life. To that end, it’s a good time to think about the US-India relationship and the importance of giving back for India’s development.

Although the news about US-India relations tends to focus on chest-thumping topics like India’s growth rate or India’s latest military purchase, the reality is that 250 million Indians live under $1.25 a day, 800 million Indians still live under $3 a day and nearly 400 Indian million children are not getting the education that they deserve. No amount of startup investment or military exercises will make India into a global power until it can make a dent in these numbers. The world respects countries that have taken care of their own people first.

To his credit, Prime Minister Modi has actually launched several initiatives to address poverty. The Prime Minister has continued to build the Aadhar card concept launched by Manmohan Singh, which creates a unique biometric ID for all Indians to receive government benefits. It has launched Pradhan Mantri Jan-Dhan Yojana, which has created over 100 million formal bank accounts for poor Indians. Now, there is a national payments system set up to allow for mobile banking. Demonetization will also benefit this formalization of the economy, after the chaos settles down. In 5-10 years, the combination of these programs could transform India by connecting all Indians to the formal banking system for payments and transactions. Less cash, less corruption.

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Attacking poverty in India is an area where the United States can be an extraordinarily useful partner. The United States government, through USAID, OPIC and other agencies, is the largest foreign funder of development in India already. And the private sector, led by American companies and the successful diaspora, also donates hundreds of millions annually towards good causes in India. This is an area where there is a lot of room for advancement.

There are two important things that the Trump Administration and the Modi government can do to boost India’s development for the long term. First is the replication of programs like the Public Health Foundation of India (PHFI). This program, launched in 2005, involved the Government of India, McKinsey, the Gates Foundation and over 10 leading American colleges of public health. Over the last decade, PHFI has built, or is building, eight Indian Institutes of Public Health, to train the next generation of public health workers for India. The American partners are training Indian faculty to teach public health in India, and providing assistance with global best practices and research around India’s health care challenges. In addition, several American, Indian and British charitable foundations are funding the organization’s growth.

India and the US can try to recreate that relationship in many areas – including agriculture, education, and allied health care. In these sectors, India’s colleges and institutions need major help. Similar to PHFI, the United States can provide capital and expertise to help India improve its teaching, research and universities in farming, education and health care.

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Secondly, the US and India can expand and improve the US-India Science & Technology Endowment Fund, which provides seed grants to US and Indian researchers. Similar programs that the US government has with Israel and Korea are much larger and more impactful. The United States and India can allocate greater capital for joint research collaboration between Americans and Indian universities and startups towards innovation in water, farming, edtech and other areas.

On the private sector side, there are also two important things that the US and India can collaborate on towards India’s development. First, the diaspora will need to take a larger leadership role than it already has. Indian NGO’s such as the Akshaya Patra Foundation, the American India Foundation and Pratham all raise $5-$10 million annually from Indian Americans for their programs in India. But this is just a drop in the bucket. The community has the capacity to contribute MUCH more than it does.  The wealthiest members of the diaspora – many of them billionaires, have not really given more than a few million dollars towards India’s development. But to harvest those donations, community leaders will need to build a better philanthropic infrastructure that reaches more Indian Americans – more NGO’s need to have professional staff and invest in fundraising and more rich NRI’s must find their philanthropic nerve.

Secondly, American companies can help their Indian counterparts to build better corporate philanthropy and CSR programs. India requires its publicly-traded and large private companies to donate 2% of its profits to charity in India. To date, India’s companies have done little except treat the law as a tax. They have not invested in staff, professional grant making or measuring impact. American companies, on the other hand, have decades of experience in their corporate foundations with effective grant making. A partnership here can direct nearly $2 billion annually towards better impact in India.

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There are a million things to do to help India’s poor in rural areas and urban slums. Whether or not the Trump/Modi summits spend any time on it is debatable. But that should not stop the rest of us.

(Nish Acharya is the author of the The India-U.S. Partnership: $1 Trillion by 2030. Acharya, who served the Obama and Clinton administrations, is also a principal at Equal Innovation, LLC, a strategy consulting and investment group working with universities, governments, foundations, and companies to assist them with innovation, entrepreneurship, and globalization strategies. He serves as a member of the Council on Foreign Relations, the Bretton Woods Committee, The Indus Entrepreneurs, and the Clinton Global Initiative.)

More from Nish Acharya:

US-India relations under Trump and Modi: areas where ties can surge (November 16, 2016)

Narendra Modi equals Hillary Clinton, not Donald Trump (November 4, 2016)

RHC Trump event makes Hindu Americans and Indian American community look like buffoons (October 17, 2016)

No diaspora-related activities for Narendra Modi this time around in the US (June 10, 2016)

US-India relations need adult supervision (February 13, 2014)